A quiet weekend in the phone-hacking scandal? Of course not. The crisis slides unpredictably in all directions, almost hour by hour. The arrest of Rebekah Brooks today is by any standards a sensational development. The resignation of the Met police commissioner, Sir Paul Stephenson, just hours afterwards, made a usually quiet Sunday extraordinary. Who would have thought, two weeks ago, that both Brooks and Stephenson would be gone by now? And yet the resignations are coming so thick and fast that nothing seems surprising.

The police are now so mistrusted that their arrest of Brooks was immediately questioned by the Dowler family and some MPs as a dodgy swerve to get her out of Tuesday's parliamentary inquisition. But if she doesn't go on Tuesday, she will surely have to go another day. Ordinary citizens ask: who's working for whom? David Cameron, normally so breezily eloquent, seems no longer to know what to say.

In this cascade of events, a few things stand out. First, the select committee hearing, with or without Brooks, is a remarkable moment. Rupert Murdoch disdained ordinary MPs. He would condescend to talk to a prime minister or a party leader, provided they kept smiling, and told him what he wanted to hear. Now he and his snippy son are being dragged to be cross-questioned in a way unthinkable even two weeks ago. Had they not agreed, they would – as John Whittingdale confirmed yesterday – have been arrested and possibly even banged up in Westminster's clocktower.

What next? News International, lacking a strategy, and led by a man who seems suddenly very old, is in terrible trouble. To save itself, it may have to sell its other papers. Are there sane, respectable buyers? Would Alexander Lebedev think of buying the Times to merge it with the Independent? Who knows? But nobody interested in journalism could regard the loss of the Times and its Sunday sister with equanimity. Can Murdoch himself stay on the bridge, never mind his son – who knows?

It used to be said that the Russian tsarist system was autocracy, tempered by assassination. British public life feels similar: we don't do thoughtful, deliberate, progressive change. We do long periods of complacency, followed by explosions of outrage.

We don't properly confront the casino-banking system, until – bang! – all bankers are found to be evil and greedy. Fred Goodwin is the Andy Coulson or Rebekah of that one. Hardly anybody discusses MPs' money until suddenly – crash! – MPs are evil and corrupt. Take a bow, Elliot Morley and David Chaytor, both jailed. Nobody talks much about how stories end up in newspapers, until suddenly – wallop! Journalists and executives, who made such a good living tearing at other institutions, are at last experiencing the same unforgiving mechanism of public opinion in its outraged mode.

Like the MPs and like the banks, the News International people may finally be brought down by bank statements. NI is famously rigorous and detailed in its accounting – right down to the last expense claim – and therefore the paper trail for pay-offs to the police and for phone hacking will surely exist, and will surely have senior initials all over it.

The tougher question during what Americans have been calling "the British spring" is what it means for our democracy. Just as Tuesday's select committee hearing is the moment when MPs can start asserting themselves against the power of the moguls, so the tacit deal between Labour and the Liberal Democrats feels like a pivotal moment for the political class.

If Ed Miliband and Nick Clegg can agree on limitations for media ownership then it will happen. We will get a more plural media landscape in which nobody will have the weight of a Murdoch ever again. That would be a huge seizure of power back by elected politicians. Miliband and Clegg have an interesting joint momentum on this. Can it be used in other ways, too?

Miliband's bravery may have infected, like a benign contagion, the whole political class. When Rupert and James (assuming he isn't arrested too, as some predict) face the media committee I hope they will find MPs who once cringed and simpered, ready to grill them pitilessly. There is nobody so friendless as a bully who's lost his ability to intimidate.

This is not – and should never be seen as – a "Westminster village" issue. A wide range of ownership will mean a wider range of ideas being taken seriously in the national media, a better conversation. It will end a form of politics in which a tiny cluster of top politicians and media people (and police, and business leaders) "count" and most MPs are irrelevant followers. We should get better decisions on tax, welfare, immigration and the bread-and-butter issues.

For those who don't know, or haven't believed in, the tradition of tight, anti-democratic collusion in this country, all I can say is that it has been visible, close-up, since I started reporting politics in the 1980s. There were always in-groups, small parties and dinners for proprietors, cabinet ministers and perhaps the odd political editor, which the rest of us heard about but never got near. Up to a point it has always gone on. Churchill and Beaverbrook, Labour and Maxwell.

Yet it has worsened. Margaret Thatcher was greatly helped by the support of the Murdoch papers, who behaved disgracefully towards Neil Kinnock. But Murdoch and Thatcher were instinctive ideological soulmates and it was clear who was the senior partner. The idea of Thatcher paying court to Murdoch was absurd. It was the other way around.

The rot set in with John Major's hapless attempts to stay in favour with Murdoch and Tony Blair's shameless political flirting to win him over. Ideology was no longer relevant. Blair's team regarded Murdoch's support with an almost mystical awe. That's when Murdoch's summer parties became the most desired places to be seen.

Cameron merely picked up the strategy and pushed it further. It seemed risk-free. He comes from the world of PR and personal contacts, high-fiving Matthew Freud, hugging Rebekah and bringing Coulson into his inner office too. Who was in whose pocket?

We have been sleepwalking into a Berlusconied Britain, a post-democratic state of winks and nods. Suddenly there is a chance to break the spell. It won't last for ever, and it needs brave, decisive action by MPs. A stronger democracy – whose authority comes from election, not from money? Too much to hope for. But actually, today, it isn't.